HYDERABAD, Pakistan, July 18 (Reuters) Pakistani police today arrested a member of an outlawed militant group suspected of involvement in last week's killing of a prominent Shi'ite cleric.

Arshad Khan, a member of Sunni Muslim militant group Lashkar-e-Jhangvi, was arrested after a shoot-out in a pre-dawn raid on a slum area of Hyderabad, 160 km east of Karachi.

''The police came under fire but managed to catch Khan,'' said Hyder Baksh, a senior investigator in Hyderabad.

Three of Khan's comrades escaped but police seized a Kalashnikov rifle and three hand grenades from their hideout.

Khan was wanted for several acts of terrorism.

''We are also investigating if he is involved in the suicide bomb attack on Allama Hassan Turabi,'' Baksh added, referring to the killing of the cleric in Karachi on Friday.

Several top members of Lashkar-e-Jhangvi, which has forged links with Osama bin Laden's al Qaeda, have been arrested in recent months.

One of them, Saifullah, who uses only one name, was caught last month and is accused of being involved in the killing of at least 150 Shi'ites.

Members of Lashkar-e-Jhangvi have been implicated in al Qaeda-inspired assassination attempts on President Pervez Musharraf.

Reuters PKS DB2243